Through the 2004 Mental Health Services Act (MHSA), California voters approved an unprecedented increase in funds for public mental health services for severe mental illness (SMI). The Los Angeles County Department of Mental Health's new Full-Service Partnerships (FSPs) represent a major allocation of these funds toward an Assertive Community Treatment (ACT) model of care that will serve a very small proportion of their clients. This dissertation project builds on a funded R01 and will evaluate the effectiveness and cost of these FSP programs and develop the foundation for a cost-utility analysis, with the following aims: (1) To assess the validity of a generic health utility (preference-weighted health-related quality of life) instrument, the Assessment of Quality of Life (AQOL), as an outcome measure for evaluating interventions for people with SMI;(2) To assess changes in health utility over the first year of treatment for individuals enrolled in FSPs versus matched controls receiving usual care from LA DMH;(3) To estimate mental health and substance abuse treatment costs for FSP vs. usual care clients over the first year of treatment;and (4) To develop sources and methods for estimating health and non-health costs for FSP and usual care clients, for use in an eventual cost-utility analysis using all three years of data. Because FSP clients are highly selected based on high rates of hospitalization, emergency service utilization, incarceration, or homeless in the previous year, the proposed study uses a quasi-experimental difference-in-differences design with a matched comparison group, with subjects drawn from six LA DMH clinics, and with health utility assessed at baseline and every 6 months for 3 years and costs assessed for the year prior to enrollment and the 3 follow-up years. This project is relevant to public mental health for two reasons. First, it will provide information on whether the new publicly funded FSP programs achieve better outcomes for clients, and on how FSPs and usual care compare in terms of mental health costs, which will inform future development of treatments and policies for individuals with SMI. Second, the assessment of the AQoL will contribute to researchers'abilities to conduct cost-effectiveness studies of SMI interventions that are comparable to studies of other kinds of health care, thus improving knowledge of the relative cost-effectiveness of different treatments and increasing public understanding of the value of mental health services.